Category: our financial story

No one gets married thinking about divorce, but we know it happens to so many couples. If we could figure out what causes it, would we try to avoid it? OF COURSE WE WOULD. We’re not dumb. There it is in black and white, on every list of the most common causes of divorce: money and financial issues. Here’s the thing – it isn’t a lack of money that makes the list. It’s the issues that come from not being on the same page financially with your spouse – not seeing eye to eye about money. Maybe one spouse is a spender while the other is a saver, or one insists on controlling every aspect of the finances without letting the other have a say. What is comes down to is that if you aren’t on the same page, with the same vision of your financial future as your spouse, there will be issues. So, how do you get on the same page?

We got rid of cable television over two years, and quite honestly we don’t miss it. We were paying over $100 a month for so many channels we could never watch. When we sat down and looked at our budget we knew something had to give so that I could quit my job and stay home with the kids. Cable was first on the chopping block. We found three easy ways to keep our tv entertainment while cutting cable, and I’m sharing them with you today as part of the Fabulously Frugal Link Party. Link up your latest frugal post below and hop around to visit the others to find so many great ideas.

I get questions all the time about the specifics of our budget. “How much do we spend on groceries?” “How much do we set aside for clothes?” By far the most common question is, “How much do you spend on restaurants?” The answer is, “Not much.” Our monthly dining out budget on one income is $70. That’s it. Would we love for it to be more? Of course. Click on some of my ads and affiliate links and maybe we’ll get to increase it. Just kidding (but seriously…). How do we stick to spending only $70 per month on dining out?

1) We don’t go to fancy restaurants. I have a growing list of great local places and a few chains where we can get a great meal for under $20. It is possible and a lot easier than you might think. We would rather have 3-4 meals out a month than one expensive one.

2) We don’t buy kids’ meals. The Bear is still a toddler with a varying appetite, and every time we’ve ever bought him a restaurant meal we regret it because he leaves most of it on the plate. Instead we bring in a sandwich, veggies, fruit, and a sippie cup every time we go out to eat, and offer him some of our meals. Yes, this takes a little planning on our part. No, we won’t be able to get away with it forever. We’ve never had a waiter even ask a question about it, and several have even commented on what a great idea it is.

3) We don’t buy drinks. Soft drinks and alcohol in restaurants are a total rip off, in my opinion. Why would we pay $2.99 each for a diet coke? Crazy town. Sometimes we break this rule, and when we do Jed and I split a soft drink rather than both getting one. We get free refills and french kiss each other on the regular, so what’s the big deal?

4) We meal plan. Before we started budgeting, we spent an outrageous amount of money on restaurants because we were both busy and dinner time would roll around without us having a plan. We’ve learned that dinner is not an emergency, it comes at about the same time every day. If we plan out our meals one week in advance we end up spending far less on groceries, making fewer grocery store trips, and eat out far less. This way we can plan our meals out and make them count rather than have them be a last minute rush decision.

Do you have a budget for dining out each month? How do you stick to it?

This year marked our fourth Christmas being debt free with no credit cards! I cannot believe it has been that long. The sense of freedom when debts are gone doesn’t go away or lessen over time. When we started following the teachings of Dave Ramsey’s Total Money Makeover and Financial Peace University in 2009 we had NO idea how much our lives would change for the better. You can read more about our financial story here if you’re interested. This past year we transitioned to one income. Funny story: I actually called in to Dave Ramsey’s radio show to ask if we were okay financially to quit my job and become a stay at home mom in a few months and he told me to do it that day. I waited six more months, but it was so great having the advice our one of our financial heroes. Christmas is a tricky time for money and frugality. We all want to make it special for ourselves, our kids, our friends, our loved ones, and even our pets. It is totally possible to be frugal and still have a fabulous gift giving, charity helping, generous, festive Christmas. I promise. We’ve done it for the last four years and we get better at it every year.

To start you off I’ll share five easy ways you can start NOW to have a frugal Christmas next year.

1) BUDGET!!! Yes, I mean it. Plan now for how much you want to spend on everything from decorations to Santa gifts to cookies for your child’s classroom. Christmas will be here on December 25, 2013, just like always and as Dave says, it is not an emergency. If you set your budget and start putting a little bit aside in your gift or Christmas fund in January, you won’t be strapped for funds and it will make it easier to save on other things. Don’t know where to start? Write down how much you spent this year on everything. If you will be paying it off for months you know you will have to reduce. I’ll share our Christmas budget as an example.

Cards: $20

Stamps: $25

Gifts to each other: $200 ($100 each)

Gifts for Bear: $50

Gifts for Family: $160 (We draw names but still buy a little something for our parents and nieces/nephews.)

Decorations: $20

Total: $475

That total may seem super low to some of you and super high to others. Jed polled his 9th grade students and they guessed overall that we would budget to spend $500 each on each other and about the same on Bear. Let’s just say they are a little bit confused about how much their teachers get paid. Our budget will go up next year with our new addition, so we will probably budget $50 per month over the year. If you like to do holiday specific charitable giving, plan for that as well. We give monthly to our churches and causes, so we don’t do a big year end gift. Most folks do get a lot of charity asks in December though, so it might be wise to set aside a bit to cover the unexpected.

2) BUY ON SALE AND HIDE I start looking for Christmas stuff at after Thanksgiving sales, the year before. Then I strategically hide everything. All of the Bear’s presents were purchased at consignment sales, thrift stores, garage sales, discount stores like Ross and Marshall’s, or were at least 50% off at retail stores. They all looked new and he loved them. The wooden activity block came from a Rhea Lana consignment sale and cost $12. They retail from $75 to $150. I bought it in October of 2011 and saved it for this year. Your toddler will never know that you got that doll off Ebay, I promise. We have all fallen prey to the “my baby deserves the best” ploy so many times. Your baby deserves a stable home with no money problems. This premise applies to other categories as well. Decorations are on clearance everywhere right now. Buy Forever stamps for next year and set them aside. They will only go up in price.

3) LOOK FOR DEALS AND THINK AHEAD If you like to send out photo cards, take a cute family picture in August and have it ready. Sign up for emails from printing sites like Shutterfly, Tiny Prints, Minted, and Snapfish. Companies start sending out emails offering 10 free cards in September this year. I sent out about 50 cards and paid around $12 total using deal emails like those. I ordered from several different sites and only paid shipping. On other things always shop around. Always, always, always check Amazon. Download the app and do it in the store. Target now price matches year round, which rocks.

4) USE CASH MONEY, HONEY Studies show that your brain actually reacts differently when you use cash as opposed to cards. You feel it more and it triggers pain receptors. This is a GOOD thing. Remember that money you budgeted each month in #1? Take it out of the bank and put it in an envelope marked “gifts” and use that to make your purchases. If you find a deal online, write that amount on the envelope and put amount of cash back in the bank. Using cash is hard, but it is worth it. By the end of the holidays next year you will know exactly how much you spent and will have paid $0 in interest on your cards. Winning. You can read more about how we use a cash system year round here.

5) MAKE MEMORIES, NOT MONEY MISTAKES If you think back on all your holiday gifts and experiences, you will probably be hard pressed to remember more than a few gifts. What I remember most are the experiences: cooking together, driving around to see lights, decorating the tree, caroling (or kazooing – I had a really fun youth pastor), volunteering, Christmas Eve services, etc. Think about what makes your holiday special to you. Ask your spouse or siblings what matters to them. Most people probably won’t say the gifts. Draw names and set a price limit with your adult siblings, their spouses, and parents to take down the stress level for everyone. We do a $50 limit with my family. Buying one thoughtful gift for a family member is sooo much nicer and less stressful than buying 18 crap gifts for the whole bunch. Give priceless but cost free gifts to friends and family like a night of free babysitting or offer to take their family photo. Use your natural talents to make special presents for your loved ones. Our consumer culture has turned Christmas into a competition, instead of celebration of God’s love for us and our love for each other. Let’s take it back.

How do you save money during the holidays?

Do you plan ahead?

Send me your favorite frugal holiday tips by email or blog post comment and I’ll link to you in an upcoming post.

For folks who knew me back in my wild and crazy shopaholic days, the fact that I live my life debt free with no credit cards and write about frugal living probably comes as a shock. It’s the real deal though, y’all. My life changed completely when I came to the realization that if I kept digging holes for myself I would never have the life I wanted. I was never a saver and always lost at Monopoly because I just had to have those hotels. Now we live by the Dave Ramsey code of conduct and have a 6 month emergency fund. Crazy! You can read about our financial story here, and I’m sharing some of my favorite frugal living posts from the last three years with you below in celebration of my three year blogging anniversary.

When folks find out that we are on a strict budget, they often ask questions like, “How do you buy things that just YOU want?” or “Do y’all get frustrated with each other if the other spends too much money?” Before we went on the budget I had so many questions like those. We would try to be frugal and something would come along we just had to have, we’d buy it, and then feel guilty. One of my favorite things about the budget we have now is the concept of mad money. Every month we budget in a certain amount for both Jed and I to get mad money. This money is ours individually and we can do with it whatever we want. WHATEVER WE WANT. If I want to buy a ridiculous pair of shoes, I can do it. If Jed wants to buy an expensive flashlight (happens often), he can do it. We are not allowed to get upset about the other one’s mad money purchases. Our current mad money amount is not that much ($50 each), but it is plenty to get something we want or save up. We also get $25 each per month for clothing, that we save up. One difficult thing about mad money is that we are always trying to convince the other that our intended mad money purchase should really come out of the house fund or the car fund or some other fund. Sometimes this is true, and we work that out. Sometimes it isn’t. Our house does not need yet another flashlight. Sorry darlin’. The other downside of mad money is that if you make a mistake, your mad money has to pay for it. For instance, Jed got a speeding ticket the other day, and his mad money fund took a big hit. Bummer.Mad money is one of the main reasons we are able to stick to our budget. I love that I have the freedom to buy whatever I want as long as I have enough mad money. For a born shopper like me, this is HUGE. I’ve told y’all before that doing Dave Ramsey’s Total Money Makeover and sticking to a budget has been the best thing ever for our marriage. With the budget and our mad money funds, we never fight over money. Ever. You can read more about our financial story here.

After much discussion, Jed and I decided it was time to purchase a car. We already have 2 cars, both completely free to us thanks to the generosity of Jesus/Young Life donors/family. Those cars are 10 and 20 years old respectively. We love them in their old age, and are so thankful for their faithful service. Big Red, Jed’s 20 year old GMC pick up has developed some issues that are pretty serious, so we know her days of dependability are numbered. We thought about waiting until she died a natural death, but decided the wiser thing to do would be to start the search for our next car while we still had the flexibility of two working cars.

My 10 yr old XTerra has almost 150,000 miles on her, so we thought it would be good to make her our secondary car before the miles get too high. We also discussed going to one car, but our current living/working situations don’t allow for that.

We set a budget of $10-12,000, knowing we could pay cash for that. We are FAR from wealthy by American standards, but we have worked hard to save most of my paycheck each month for over a year. We also have a 6 month emergency fund built up that we didn’t touch for this purchase.

We started looking on Craigslist for lots of different models. We both like Tahoes, Outbacks, and other small SUVs and station wagons. We looked at mini vans, but just couldn’t do it. Not that there is anything wrong with mini vans. They are great, I’m sure, just not for us right now. We test drove cars from dealers and individuals, including 2 Tahoes that I’m pretty sure were stolen or from police auctions. SOOO SKETCHY.

We looked at used car dealers in our area that were part of bigger dealerships with good reputations. At one dealer we found a 2005 Honda Pilot listed at $16,915. She was beautiful, but way out of our price range. We wanted around 80,000 miles or less, she had 81,000. She also came fully loaded with leather, a sunroof, DVD, 3rd row, rear air, and more cup holders than you could ever want or use. Right off the bat the salesman told us he could mark her down to $13,900, because she was a Honda on a Chevy lot. Still way out of our range. We drove her, and she was such a smooth ride. We went home, ate lunch and let Fisher take a nap. We checked the Kelly Blue Book and her Carfax. The Carfax came back saying that she was worth $330 more than the KBB value, which was $18,600. Whoa. So, she was offered to us at $5000 less than the KBB value. She was still over our budget by almost $2000. Not ok. Then we pulled up the dealer website to look over the details again, and noticed that the rock bottom internet only price they had listed was $12,500. Hmmm. That might be doable for a car that is far beyond anything we had hoped to find.

We went back to the dealer that afternoon and told our salesman about the internet price. He said he would have to honor it. We went for it, on the contingency that our trusted mechanic could take a look at it first. He asked us about financing, and we told him we were paying cash. That threw him off completely. He didn’t really know what to do, and said no one had done that since he had been there.

They wouldn’t let us use our debit card or write a check, so we had to wait until Monday morning when I could go to the bank and get a cashier’s check. I handed the check to the dealer, they gave me the keys, and we were done. No car payments for us! We love our new ride and are so thankful to not have a big car payment every month.

Why pay cash? Interest my friends, interest. Let’s do a little math. If we put down $1000 and financed $11,500, we would actually end up paying over $1000 extra for our car. Yikes. That’s a lot of money.

Have you ever paid cash for a big purchase? How did you make it happen? Would you do it again?

I like to decorate with natural elements whenever possibly, and I love a fall display. One of the components of our first date was a pumpkin patch, so Jed knows pretty gourds are the way to my heart. He brought home a whole bushel of various pumpkins and cute gourds from his trip to Lubbock last weekend. Thank you, sir. The best part was that he got them all for just $10. Woohoo! I’ve got gourds coming out my ears but our budget didn’t take hit. I’ve put them all over the house and still have a ton to give away.

Last year was a landmark one for our family. We moved again, began the journey to parenthood, and accomplished a number of financial goals. I’ve compiled a list of my favorite frugal and financial posts from 2010. It was fun for me to look over the posts to see how we’ve grown. I hope you enjoy them. Click on a title to check it out.

There are many things that I love about the Christmas season. I love the meaning, traditions, decorations, time with family, time with Jesus, singing carols, the movies, and the giving and receiving of gifts. I do not love holiday stress, busyness, and money worries. Last year was our first year on the Dave Ramsey plan, and we were newly debt free. We budgeted for Christmas presents and used only cash and debit and it was so freeing. We loved it so much that we did it again this year.

We budget how much we want to spend on each other, our families, charity, and our friends, and then we pull the cash out each month and keep it in our gift envelope. Christmas comes every year and is not an emergency, so we want to make sure we are prepared so that we can be generous with our gifts. We pull out gift money through out the year to cover wedding and birthday gifts, and starting in September we add to the amount significantly to cover our Christmas gifts. Because we pull out money in September, October, and November, we didn’t have to take out much in December at all. We take our budgeted amount out of the envelope and use it to buy the gifts. If we buy something online with the debit card, we put that amount back into the bank. It feels so good to have the money to buy each other and our loved ones gifts without any stress.

We don’t have to worry about the credit card bill showing up in January reminding us of our mistakes. We have no money stress about Christmas. We remember the weight of credit card debt and never want to feel it again. Many of our friends and family have asked us why we would want to miss out on the airlines miles or rewards that come with many credit cards. We’ve heard from lots of people that they use credit cards because of those rewards. To us they just aren’t worth it. Credit card companies offer rewards so that folks will spend more, and studies show that is exactly what’s happening. We are completely convinced that no one beats the credit card companies. They always win. They make so much money off of the debt people incur to get some miles that I would rather not help them. Many friends claim to pay their bills off every month, and while I want to believe them, statistics show that it can’t be true all the time. You get behind one month or are late with one payment, and you’ve lost all the reward money you earned. We’ll pass on that. We have too tragic a history with credit cards and both of us have made HUGE mistakes in the past. Kudos to you if you can beat the system, but it isn’t for us. What’s in our wallet? Cash, baby.

Here’s some great info from Time magazine online on credit cards and their reward systems:

On the surface, it would seem like credit card issuers are foolishly giving away money with cash-reward cards, and that a cardholder getting 1% or 2% back is reaping in easy money. The reality is much different. Simply put, the study says:

The main objective of the card companies is to increase card spending that may result in cardholder’s debt in the future.

And based on the figures, the card companies achieve wild success in this objective. More spending. More debt. But hey, you get those occasional $50 cash-back checks in the mail! At least, that is, if you remember to keep track of your rewards and order the check—because these programs typically don’t give you cash back automatically.

For the consumer, getting cash back is of course better than getting nothing—but only if you don’t increase your overall spending due to the perverse incentives inherent in cash-back cards. Spending a dollar to get a penny back doesn’t make sense.

But what if you were spending the dollar anyway? Then it seems silly to not get the penny-per-dollar reward. The problem is that it’s all too easy for consumers to justify extra spending with credit cards. Studies show that you’re likely to spend 12% to 18% more with a card compared to cash. And when you’re vaguely aware that every item you pick up shopping gives you a little more cash back, well, then you’re even more likely to place more stuff in your shopping cart.

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Meet Becca of BFOTD

Becca is a follower of Jesus, wife to Jed, and mama of two wee ones. She loves creating, traveling, being frugal and adventurous, and blogging about it all. She is based in Dallas, Texas. Email her at barefeetonthedashboardATgmailDOTcom for more information.